Team Split with a rookie

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Mar 13, 2010 9:46 am

Has anyone been in a situation where the rookie is told thay have to be on a team, but they give the team 50% commission and the team gives the rookie 0% commission.  They tell the rookie that he won't land the client without the guidance the skills of the seasoned brokers so it's better to do a 50% split than lose the client.

I've been told this is raping the rookie?  Any thoughts?

Mar 13, 2010 1:26 pm

it is raping the rookie. 

And your branch manager is a total a hole for encouraging it.  (And he is in on it - the TEAM didn't decide to come to you with that BS offer before conferring with the Branch Manager)  Feel free to copy and paste my comments in an e-mail to your BM and ask him if it's true.  Please post his reply.

By the way - Ex Merril FA?  Where are you now?

Mar 13, 2010 3:04 pm

They are forcing you to give up 50% of you commissions? I would have a serious issue with that if I were you. I'll bet FINRA would have an opinion ab out that as well.

Mar 13, 2010 6:37 pm

Are you getting any other comp?  Are you getting clients from the team?

Other problem is... why are you being forced on the team?  Not having enough production by yourself?

and are we talking about 50% split on commissions on all clients, or just the ones from the team?  and your 50% then hits the grid?

are you getting salary from the firm or getting paid by the team?

Mar 13, 2010 9:48 pm

Don't do it.  They want to use you and take your clients

Mar 13, 2010 10:43 pm

To answer aeromaks question, I get a base salary for the 1st year and then declining salary 2nd year from the firm plus commission. I am being rated on the commissions I make.  Only my 50% my commission then hits the grid.  Firm policy is that everyone is on a team.  I am new so I was put on the team.  The team gave me no assets or comp.  If they helped me with a client, they took half the commission.  So I stopped asking for their help.  I opened 25 accounts on my own compared to the 5 with their help.  They don't talk to me.  They only sit in on meetings with me and I do all the prospecting and work around the account.  we do have an assistant that processes the paperwork.  I am given none of their commission or revenue from their accounts.

Mar 14, 2010 3:36 am

did you know that was the deal?

And if you are giving up 50%, why not try to be part of the team and see, maybe they will give you some of their book.

Mar 14, 2010 7:36 am

When I started, I thought I was to be given part of the book and a split would be part of the agreement.  Once I started I realized that I got no part of the book and if I asked for help with a client, they took 50%.  So I stopped bringing them in with prospect meetings and kept 100%.  Now the boss says that I need them in all the meetings and they get 50%.  I'm told that I should have faith and the numbers will work out.

Mar 14, 2010 11:44 am

UBS?

Mar 14, 2010 12:08 pm

Yeah where are you at?? And more importantly why did you go there?

Mar 14, 2010 12:29 pm

I'm embarrassed to say where I'm at because it's a highly regarded firm, not an independent, not a major wirehouse.  It has an excellent reputation.  My coworkers are amazing.  I never dreamed I would be in this situaion.  Everyone speaks highly of my boss and my partner.  I just don't understand.

Mar 14, 2010 1:08 pm

[quote=EXMerrillFA]

I'm embarrassed to say where I'm at because it's a highly regarded firm, not an independent, not a major wirehouse.  It has an excellent reputation.  My coworkers are amazing.  I never dreamed I would be in this situaion.  Everyone speaks highly of my boss and my partner.  I just don't understand.

 [/quote]

 Ok so that leaves non-major wires(bear,gs),regionals,banks,boutiques and Ben Edward maybe...  So why did you go there?

Mar 16, 2010 1:12 pm

[quote=EXMerrillFA]

When I started, I thought I was to be given part of the book and a split would be part of the agreement.  Once I started I realized that I got no part of the book and if I asked for help with a client, they took 50%.  So I stopped bringing them in with prospect meetings and kept 100%.  Now the boss says that I need them in all the meetings and they get 50%.  I'm told that I should have faith and the numbers will work out.

The boss is right, the numbers will work out - for the boss!

Dude, you are slave labor and part of a model that will enrich your partners at your expense. All the accounts you open-assets you bring in will go to them when you flunk out. Then they get a new slave and process begins anew.

Any partnership that doesn't fairly compensate all partners isn't a partnership.

Partnerships can be a good thing for rookies. The mentoring relationship can really help those just starting out. Unfortunately, in this case you seem not to be getting that help. And, you obviously have the ability to operate without their help. If you can, you need to seperate yourself from this group. Possibly move to another office? Regarding the mandatory partnership, even if true, maybe someplace else you can get something more for your effort. Like learning a successful business process for example. Staying where you are and getting nothing for it will drain you. And they could care less.

[/quote]

Mar 16, 2010 1:22 pm

You are hired help, not a partner.

It's hard enough to make it in this business to begin with, without some snurdleys taking half your gross.

When I was offered to come onto a team at Merrill a year or so ago, my deal was that I would get 100% of production of whatever book I brought over, 33% of production on some assets they would give to me to manage (mostly <250K accounts), and then an equal % (3 partners) of all NEW business that comes into the partnership (regardless of who brought it in, including myself).

That actually seemed quite fair. 

You are the proverbial new guy in the prison shower.

Mar 16, 2010 9:07 pm

[quote=B24]

You are hired help, not a partner.

It's hard enough to make it in this business to begin with, without some snurdleys taking half your gross.

When I was offered to come onto a team at Merrill a year or so ago, my deal was that I would get 100% of production of whatever book I brought over, 33% of production on some assets they would give to me to manage (mostly <250K accounts), and then an equal % (3 partners) of all NEW business that comes into the partnership (regardless of who brought it in, including myself).

That actually seemed quite fair. 

You are the proverbial new guy in the prison shower

[/quote]

I'd take that offer. ExMerrill, sounds like you dropped the soap as the new guy in the shower.

Mar 17, 2010 10:27 pm

Well, I got a divorce.  I severed the relationship.  There are other financial advisors looking at taking me on with a more equitable split.   I appreciate everyone's advice.  I thought I was losing my mind.

Mar 18, 2010 5:18 pm

Sounds like you should have severed their heads from their bodies.

Mar 19, 2010 11:46 am

I may be the only one who doesn't think that you got a bad deal.   Look at this from a slightly different perspective:  When another member of the team sold something, you received nothing.  You also did no work to get this nothing.

When you brought in a client and did all of the work, you got to keep 100%.

If you brought in a client and asked for help, they charged you 50% for the help.

In other words, you were never part of a team, you just had some people who you could choose to partner with in exchange for a split on a case by case basis.

Mar 19, 2010 10:06 pm

You are absolutely right.  I would gladly do a split with a senior advisor on a prospect that I did not feel I could close.  50% is better than nothing.   My solo close rate was incredibly high.  I had several high level prospects that I lost specifically because of this senior advisor.  I also closed some prospects because of the advisor.  This advisor had no time for me and did not mentor me.

The proplem was I was now being told that I had to bring in the senior advisor in all of my prospects and split with all my prospects.

Mar 19, 2010 11:03 pm

ExMerrillFA – My intentions are not to hijack your thread and if you feel this post does just that let me know and I will remove it...

With the practice I am with, I've had the opportunity to be on both sides of the desk. I do not have the experience in regards to an ideal relationship, but would like to ask for those with the experience to respond...

I feel the first initial interview and negotiation process for me left some potential benefits and value on the table because of my lack of biz knowledge. I also had the opportunity to "listen" in on a potential new hire and must say it is sometimes difficult to read someone's potential in the interview process.

My question that pertains with the OP is: (by team I mean any entity hiring a rookie/newb/fng)

1. As the "team" what do you want to see in a “rookie” and what would be a fair negotiation assuming the “rookie” has the potential you are looking for?

2. As the "rookie" what do you want to see in a "team" and what would be a fair negotiation assuming the "team" has the opportunity you a looking for?

Those of you that have the experience of being on one and/or both sides, I thank you in advance for you contribution.

Tks EXMerrillFA for letting me hijack the thread and let me know if this is not ok.